Lula da Silva celebrates a month of government between storms and great challenges

Brazil’s president, Luiz Inácio Lula da Silva, is about to complete his first month in office on February 1, an anniversary that sees his government face several challenges in an agenda stirred by shrapnel from a coup attempt in Brazil , a complicated economy and the new role for his country that the head of state has tried to promote in the first 30 days in power.

Strictly speaking, the new president had little time to adjust to the position he took on for the third time.

Already on January 8 he had to face the invasion of the seat of the three state powers in Brasilia by thousands of followers of Bolsonaro, whom he defeated in a runoff at the end of last October, something the far-right leader has never recognized .

Bolsonaro has been in the United States since December 31, when he went to Florida not to hand over power to his rival.

The invasion of the thousands of Bolsonarists calling for the intervention of the armed forces against the recently assumed government has been condemned all over the world.

From the first moment, Lula said he was convinced that there was internal complicityboth military and police, in the invasion. And he singled out Bolsonaro as responsible of excesses since “he spent four years inciting people to hate” while he was at the helm of Brazil (2019-22), according to what he said in a statement in São Paulo.

Military and police purge

The issue occupied Lula for more than half of his first month, until it led to a purge against at least 58 soldiers serving at the presidential residence and after he fired and opened investigations against several civilian heads of security organizations .

Bolsonaro denies any connection to the violent acts in Brasilia, but is being investigated by Brazilian authorities on suspicion of instigating them. More than 2,000 people have been arrested since then, of which 1,382 remain in the hands of the authorities.

Pressure on public finances

In parallel, as the new government expanded its court filings for the January 8 coup, several days of turbulent markets and large stock market falls underscored the fact that Lula will have to juggle to expand spending which allows it to cover a large social demand while the economy tends to cool down.

A signal of the problems was given by the stock market falls when the president ratified that he would breach the fiscal deficit ceiling, which is guaranteed by law in Brazil, to obtain more funds to finance his social agenda.

The public debt it stands at around 76.8% of GDP with a consolidated deficit of 4.21% of GDP. Public spending has skyrocketed in recent months also due to the subsidies for the poor and fuel price controls decreed by Bolsonaro, despite the Constitution forbidding this type of maneuver in an election year.

Lula’s main election promise will put more pressure on public finances, since he will allocate about 27.8 billion dollars to social assistance, a rumor that it will exceed the budget limit and lead to an increase in debt.

In this context, the economy is slowing down rapidly due to the aggressive monetary policy implemented by the Central Bank to control inflation, which has brought interest rates to 13.75%.

regional leadership

Despite these internal problems, President Lula made that clear in his first month in office Brazil wants to return to leadership of the region.

A sign of this was the expectation of his visit to Argentina a week ago and then the summit of the Community of Latin American and Caribbean States (CELAC), from which the far-right president excluded himself in 2020, due to the presence of Cuba , Nicaragua and Venezuela.

During your visit, Lula defended the presence of Havana and Caracas at the headquarters, despite complaints from undemocratic countries and for human rights violations, which add to the position of the government of Alberto Fernández. Finally, Venezuelan Nicolás Maduro suspended his trip.

Lula da Silva’s visit also addressed the strengthening of Mercosur – which brings together Argentina, Brazil, Uruguay and Paraguay – which is facing turbulence on possible out-of-bloc agreements between Uruguay and third countries, such as China.

The possible establishment of a common South American currency for trade purposes to facilitate integration was also discussed.

The hectic opening month of Lula’s new term ended with the Definitive agreement with the White House for the meeting between the Brazilian and his American counterpart Joe Biden on February 10 at the White House.

Analysts in Argentina and Brazil have marked the gesture of the head of the Oval Office with which the United States seeks to strengthen its alliance with Brazil by distancing itself from a government in Buenos Aires that shows its harassment of the judiciary and supports authoritarian leaders like Ripe.

Argentine President Alberto Fernández awaits a new date to meet with Biden as the scheduled meeting was suspended in July.

Source: agencies